Learning Center

Don’t Invest Without Discipline

Date22 Sep 2014

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A well-thought-out financial plan is necessary for successful investing, but even the greatest plan won’t bear fruit if an investor doesn’t have the discipline required to stay the course, rebalancing and tax-loss-harvesting as needed. Unfortunately, even thorough and intelligent plans will sometimes end up in the trash heap because investors lose heart when their strategy...

Your Mutual Fund Manager Will Retire Before You Do

Date22 Sep 2014

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Your mutual fund manager has a solid plan for retirement. So far, it’s working beautifully. Your fund manager is fortunate to be part of a growth industry. Since 2004, assets under management have grown 124 percent. The number of U.S.-based stock and fixed income mutual funds has grown to more than 5,000. Collectively, they manage...

Overview of Mortgage Backed Securities

Date22 Sep 2014

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Q: What are mortgage-backed securities? A: Investors of mortgage-backed securities (MBS) own an undivided interest in a pool of mortgages that serves as the underlying asset for the security, and these investors then receive a share of the resulting cash flows. A nationwide network of lenders — such as mortgage bankers, savings-and-loan associations and commercial...

Back To School — Back To Financial Fundamentals For 3 Generations

Date22 Sep 2014

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As kids head back to school, adults spanning several generations set their sites on getting their financial house back in order. What are the most important financial planning considerations in three major demographics—Millennials, Generation X and Empty Nesters? Millennials: First things first – Before making any big financial commitments, like buying a house, figure out...

Beware Tactical Asset Allocation

Date22 Sep 2014

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The financial crisis of 2008 has led to another surge in demand for funds using a tactical asset allocation (TAA) investment strategy. Morningstar currently classifies about 332 funds as tactical asset allocation funds. That’s up from just eight in 2007. The objective of TAA, which originally gained popularity in the 1980s, is to provide better-than-benchmark...

Fighting the Gender Pay Gap

Date22 Sep 2014

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My daughter started her senior year of high school this fall. With college fast approaching, I’ve had some fun discussions with her and family friends about future professions. One thing keeps coming up: It’s the 21st century, and our daughters may still earn less than men for doing the same work. When my daughter graduates...

Investing habits: The good and the bad

Date22 Sep 2014

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Choosing good investments is a necessary condition for successful investing. But it’s also important to engage in good behavior once those investments have been selected. The most recent issue of AQR Capital Management’s quarterly newsletter for clients provides great insight into both the bad behaviors investors tend to engage in, as well as positive practices...

Look Before A Low Vol Leap

Date22 Sep 2014

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A number of academic papers have demonstrated within the last few years that low-volatility stocks have provided greater returns than higher-volatility stocks. As I’ve mentioned before, these findings run counter to economic theory, which predicts that higher expected risk is compensated with a higher expected return. The result is what’s known as the low-volatility anomaly....

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